Saudi Arabian crude oil output is reaching its capacity limit we learned from Reuters. The desert kingdom is nearing its comfortable operational production limits and may not be able to make up for shortages that arise from new sanctions imposed on Iran by the West in the dispute over Iran’s nuclear program. Saudi is now pumping just under record rates of 10 million barrels per day and any extra oil is likely to be heavier crude which has little attraction to the West. If Iran oil output were to decrease, due to a US/Europe imposed embargo, it is not clear if Saudi Arabia and its Gulf partners have the capacity to constrain world oil prices. Some have suggested that the price of crude could jump rapidly from its current $100 a barrel range to $200 and push the global economy back into a deep recession.

Der Spiegel wrote about how Iran and the West have rediscovered oil as a weapon. Four decades after the oil price shocks of the 1970s Iran and the West are once again threatening to use oil and the world economy as a pawn in their chess match over Iran’s nuclear program. Tehran is threatening to block the Strait of Hormuz and shut off oil supply to the West while the US and Europe are considering a boycott of Iranian oil. How this plays out could have serious consequences for economic conditions around the globe as the countdown begins to the opening of Iran’s nuclear reactor in March.

OILPRICE reported that investment in African renewable energy reached $3.6 billion last year. 600 Africans do not have access to electricity making energy poverty among the most urgent issues facing Africa. Yet there appears to be positive news from a study by Frost & Sullivan entitled “Mega Trends in Africa: A bright vision for the growing continent”. Investment in renewable power in Africa is set to grow from the 2011 total of $3.6-billion to $57-billion by 2020, a staggering 1,583% increase in nine years. The key growth sectors will be wind power, solar power, and geothermal power. Only 7% of Africa’s hydropower capacity has been developed up to now. The 2020 renewable energy targets for the continent include 10 GW of hydropower facilities, 5 GW of wind power capacity, 500 MW of solar energy capacity and tripling the capacity of other renewables, such as geothermal, and biomass. (A gigawatt or GW is the size of a typical coal-fired or nuclear plant.)

Renewable energy has passed nuclear in the USsaid the San Francisco Business Times. The Energy Information Administration announced that in September 2011 the combination of solar, wind, geothermal, biomass and hydro passed nuclear generation as a share of U.S. power generation. The renewables share was 10.9% versus 10.4% for nuclear. The remaining 78.7% was from fossil fuels.

Remote areas of Peru are now being powered by the Sun according to the BBC. A program largely financed by the European Union is bringing electricity to remote areas of Peru and for the first time school children have access to computers and the Internet. The EU and its local partners across Latin America have targeted 600 rural communities that are not connected to the electricity grid. 130 of these communities are in Peru. Only 63% of rural areas in Peru have electricity, and 2.8 million people – about 10% of the country’s population – are still without this vital energy source. The other countries taking part in this program are Bolivia, Ecuador, El Salvador, Guatemala, Honduras, Nicaragua and Paraguay.

Germany is cutting its subsidy for solar projects by as much as 30% this year we learned from newnet. On January 1st the feed-in-tariff (FIT) was cut 15% to a range of €0.18 to €0.24 per kWh, the same level of household electricity prices off the grid. As of 1 July, the FIT is expected to drop another 15% to between €0.15 and €0.21. The German government is cutting back the tariff in light of the cost of the subsidy to the national treasury and the fact that the price of solar panels are falling rapidly.

OILPRICE looked at the future for fission nuclear power and suggests its role will be modest going forward. The benefits of nuclear are its stable power output, low carbon, potentially abundant fuel (if economies allow), and decades of experience (on certain reactor types). But this is offset by its costs: .nuclear is far more complicated than many of our other other options (e.g., solar, wind), relies on rare materials for fuel, and has serious societal barriers. Hence it is not the easiest energy source for politicians to embrace.

In a similar vein, OILPRICE wondered if this year will be the year for nuclear fusion and gave us an overview of the different ideas that are on the table. And over at the Huffington Post they asked whether thorium reactors are the answer to our unending energy demands..